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The standard usage and prices for material used to produce a batch of 100 liters of a product are as follows:
Material Liters $per liter
A 40 2.4
B 55 1.60
C 30 3
1252190 liters of products were produced in a period. The following volume of materials were purchased in the same period at a total cost of $6236, and used in production
Material A 895 liters
B 1240 liters
C 645 litersCalculate the standard direct material cost per liter of the product
I would like to know I should use (40X2.4)+(55X1.6)+(30X3)/100 liters or 120 liters????
I am a bit confused with these two figures. Is it 100 liters is std output? and 120 liters is std input?
Thanks sir
I don’t know where you are getting 120 liters from!
The standard input is 125 litres and the standard output is 100 litres.
To get the standard cost per litre you divide by 100.
I suggest that you watch my free lectures on mix and yield variances. The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.
okk sorry sir, typing error should be 125 liters and not 120 liters.
Thanks sir I gt it.
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